The duty of the lender to prove the existence of trade debts in the case of a family trade and the authority of the family manager to raise money for carrying on the business.

Venkatasubba Rao, J.

1. The question which this appeal raises is whether the mortgage debt is binding upon defendants 2, 3 and 4. The actual executant of the said bond was the first defendant, but he purports to have executed it not only on his own behalf but also as the "family manager and guardian of his undivided younger brother", the second defendant, who was then a minor. All the defendants resisted the claim, even the receipt of the consideration having been denied by the first defendant. There was a further allegation that so far as defendants 2 to 4 were concerned the debt was not incurred for a purpose binding upon the joint family. The learned trial judge has come to the conclusion that consideration was paid, with which we unhesitatingly concur. The facts may be shortly stated. A person by name Chockalinga had three daughters by his first wife but no male issue. Thereupon he adopted the first defendant as his son. Subsequently he married a second wife and the second defendant was his son by her. Egappa Chetty the mortgagee is the husband of one of Chocka-lingas daughters by his first wife. The mortgage was granted in December, 1916, and it was assigned to the plaintiff, a relation of the parties, in January, 1924. Egappa died about the year 1926. The suit was filed in 1927 and was heard in 1930. Chockalinga was carrying on a family trade, which upon his death devolved upon his sons, and it is not disputed that on the date of the mortgage bond, the first defendant was conducting a family trade at two centres, namely, Devakottah and Colombo. There is a recital in the deed to the effect that the amount mentioned as the consideration, namely, Rs. 5,000, was borrowed for the purpose of discharging the debt due by the family firm at Colombo. At the trial the account books of Egappa were produced which show that the amount was paid to the first defendant by mesne profits of a hundi. Both the 1st and the second defendants were debited with Rs. 5,000, the drawee of the hundi having been credited with a like sum. The entries were made on the 15th January, 1917, the date on which the deed was registered and the credit entry recites that the drawee is entitled to interest from the 22nd December, 1916, the date of the mortgage bond. There is absolutely no ground shown for discrediting the accounts, and we must as already stated, hold that the lower Courts conclusion on this point is perfectly correct.

2. The learned trial Judge, however, has held that it has not been shown that the debt is binding upon the other defendants, and it is this finding that the plaintiff as the appellant here attacks. According to the recital in the deed, the amount was borrowed for the purpose of paying off the trade debts of the family. The question that arises is, whether that recital is true; for, in the case of a trading family the lender is not called on to prove more than that such debts did in fact exist. What is a necessary or beneficial purpose is a question which, in the case of a trading family, is governed by considerations different from those that apply to an ordinary Hindu coparcenary. The lender discharges his duty by showing that there were in fact trade debts in existence, that is to say, that the debts had been incurred in the course of or for purposes of the trade. There his duty ends and he is not called on to prove further that in the incurring of the debts the manager had acted prudently; nor is he required to prove that the debts could have been discharged otherwise than by borrowing the amount from him. To hold differently would be to throw upon the lender a duty so onerous that no ordinary man can be expected to perform adequately. Moreover, it would neither be reasonable nor in the interests of the borrowing family itself to require the lender to make an investigation and ascertain whether the manager could have carried on the trade more advantageously by pursuing a different course. As Mayne observes in his Hindu Law